In 1MDB scam, sheikh wouldn't get out of bed for less than US$100 million: Leissner

Tim Leissner's (centre) testimony about the alleged payments came in his third day on the stand in the trial of Roger Ng. PHOTO: BLOOMBERG

NEW YORK (BLOOMBERG) - One hundred million dollars - that was the cost of doing business in the multi-billion-dollar 1MDB scam, former Goldman Sachs Group banker Tim Leissner testified.

Leissner, 52, the United States government's star witness in its case against former Goldman banker Roger Ng, provided a description of the payment system Wednesday (Feb 23) for a jury in Brooklyn, New York.

Leissner told of a meeting at which Low Taek Jho, known as Jho Low, the alleged architect of the massive fraud, spelled out who he said needed to be paid off for approval to raise and spend billions of dollars for Malaysia's wealth fund, 1Malaysia Development Berhad (1MDB).

On the list were officials from Malaysia and Abu Dhabi, Leissner testified, including Malaysia's then Prime Minister, Najib Razak, and Sheikh Mansour bin Zayed Al Nahyan, the Deputy Prime Minister of the United Arab Emirates.

Low "said the sheikh would not get out of bed for less than US$100 million (S$135 million)", Leissner told the jury.

Sheikh Mansour has not been accused of wrongdoing by the US. The UAE government media office and UAE Foreign Ministry did not immediately respond to an e-mailed request for comment.

Leissner's testimony about the alleged payments came in his third day on the stand in the trial of Ng, his former subordinate at the bank and the only Goldman employee to be put on trial for the 1MDB scandal. Billions of dollars were siphoned from funds meant for development in Malaysia.

Leissner pleaded guilty in 2018 and his cooperation in the trial may help him get a reduced sentence. Ng has pleaded not guilty to money laundering conspiracy and bribery charges, and his defence lawyers say he warned Goldman officials about doing business with Low.

The trial was interrupted on Wednesday by revelations that the government failed to turn over more than 15,500 documents related to Leissner. The judge has said she will pause the trial before defence lawyers begin questioning Leissner, and Ng's attorney has said he may ask for a mistrial.

The meeting Leissner described while on the stand took place at Low's home in the Mayfair section of London in 2012, not long before Goldman greenlighted work on 1MDB and raised US$1.75 billion for the fund, Leissner testified.

The project could not move forward unless 1MDB secured an outside guarantor for the debt it was about to take on, he told the jury. He said Low, who held no official position at 1MDB but exerted outsized influence there, was able to get that guarantee from the sovereign wealth fund of Abu Dhabi and its subsidiaries.

At the meeting, Low took out a piece of paper and "started drawing boxes", Leissner told the court. On one side of the page were several boxes for Malaysian officials who needed to be paid off, and on the other were boxes for the Abu Dhabi officials, he said.

Low said that at the top levels, payments to the Malaysia and Abu Dhabi sides of the criminal enterprise "had to be the same and be perceived to be the same", Leissner testified.

"In my mind, that meant both sides had to get US$100 million," Leissner testified. "I can't say I was surprised," he added, saying years of working in emerging markets had taught him that bribes and kickbacks were sometimes associated with projects involving government officials.

At the end of his presentation, Low said Leissner and Ng would also be "taken care of", Leissner testified. "I was of course happy that I was about to make some additional money," he told the jurors. "I wanted to make more money, even though I was well paid at Goldman Sachs."

Leissner said that after the meeting he and Ng walked back to Leissner's hotel. "As Roger and I walked, we agreed we would never say anything to anyone at Goldman Sachs or outside Goldman Sachs (about the payments) other than the participants that were there," Leissner testified.

"Bribes had to be paid to make it happen," he said, "but we always kept it to the two of us."

Leissner testified on Thursday that he also stole tens of millions of dollars from his accomplices in the fraud.

He said that "a large portion" of the US$6.5 billion raised through three 1MDB bond deals he helped organise with Ng was siphoned off to pay kickbacks and bribes to officials in Malaysia and Abu Dhabi. But the US$60 million in kickbacks he kept for himself was not enough, Leissner said.

When Low asked Leissner to "hold" €145 million (S$220 million) in a shell company in Mauritius, Leissner saw an opportunity. Because much of his money was invested in illiquid assets, Leissner told the jury he kept US$80 million for himself. He said he then borrowed another US$1.25 million from Ng, his subordinate at Goldman.

Leissner said his arrest in 2018 prevented him from repaying Ng any of the money. "I had the intention to pay him back over time but I didn't have a chance," he told the jury.

Former Goldman Sachs banker Roger Ng is charged with conspiring to launder money embezzled from 1MDB. PHOTO: REUTERS

In his fourth day of testimony on Thursday, Leissner delved into his personal life including how he lied, stole and cheated. It is a common practice for prosecutors to highlight the negative aspects of their witnesses to get ahead of anything that could be revealed by defence lawyers during cross-examination.

Leissner said he used some of the money he stole from Low to buy a US$50 million boat, part of the Inter Milan soccer team and a Manhattan apartment at 68th Street and Madison Avenue.

Some was also used for a down payment on a Los Angeles home he'd share with his new wife, Kimora Lee Simmons, whom he met in 2013, Leissner said. He said he also invested in a multi-platform media company called All Def Digital and in Celsius Holdings, an energy drink.

On Thursday, Leissner also confessed he was twice married to two women at the same time. He said he "faked" a divorce decree in order to marry Ms Simmons while still being married to Ms Judy Chan Leissner. He also told jurors he had earlier falsified a divorce document in order to marry Ms Chan in Hong Kong in about 2000.

"I photoshopped the divorce document," he said of his 2014 marriage to Ms Simmons, a fashion designer.

"Did Judy Chan know?" asked prosecutor Drew Rolle.

"Yes," he said.

"Did Kimora Lee Simmons know that?" Mr Rolle asked.

"No," Leissner said.

Leissner said Ms Chan was not as forgiving, In 2014, he wanted to put a US$900,000 down payment on a home in Los Angeles for Ms Simmons but said, "Judy did not want to make any transfers related to my new family life in Los Angeles".

Instead, Leissner said he faked an e-mail claiming Low needed money. "It didn't work" with Ms Chan, he said. "I think she did some research on the Internet and found out I was trying to buy this house."

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